Group 1 - The article does not contain relevant content regarding company or industry insights [1]

Summary of Zoetis Conference Call Company Overview - **Company**: Zoetis - **Industry**: Animal Health - **Current Market Size**: Approximately $50 billion, projected to grow to $90 billion over the next 10 years [4][3] Key Industry Insights - **Growth Drivers**: - Strong sectoral tailwinds in both companion animal and livestock segments [3] - Increasing global population demanding nutritious protein [4] - Shift towards pet medicalization driven by younger pet owners (Millennials and Gen Z) [6] - **Market Trends**: - Companion animal market growth driven by increased spending on veterinary care and advanced therapies [6] - Livestock sector recovering from disruptions caused by African swine fever and COVID-19, with mid-single-digit growth [8] Company Performance - **Revenue Growth**: - Zoetis has achieved an 8% compound annual growth rate (CAGR) since its IPO, outperforming the industry average of 5% [5] - **Profitability**: - EBITDA margins of 41%-42% and mid-20s return on invested capital (ROIC) [21] - **R&D Investment**: - $5 billion invested in R&D since IPO, leading to 2,000 regulatory approvals over the last decade [9][10] Product Pipeline and Innovation - **Future Blockbusters**: - 12 potential blockbuster drugs in the pipeline, with expectations for major market approvals annually [11][12] - **Key Areas of Focus**: - Chronic kidney disease, oncology, cardiology, obesity, and anxiety in pets, with significant market potential [13][14][15][16] - **Diagnostics and Preventatives**: - Emphasis on expanding diagnostics and preventative care in livestock and companion animals [20] Market Position and Strategy - **Commercial Excellence**: - Direct field force in 45 markets, combining sales with medical affairs and marketing for effective execution [15] - **Product Leadership**: - Simparica Trio leading in the parasiticide space, with high customer satisfaction [16] - **Dermatology Portfolio**: - Strong portfolio including Apoquel and Cytopoint, with plans for long-acting products [17][18] Financial Strategy - **Capital Allocation**: - Focus on innovation, disciplined capital allocation, and returning excess cash to shareholders through dividends and buybacks [24][25] - **Shareholder Returns**: - Over 125% of free cash flow returned to shareholders in the last three years, with a 13% CAGR in dividends [24] Challenges and Outlook - **Short-term Headwinds**: - Anticipated slowdown in companion animal growth due to price increases and macroeconomic factors [27][29] - **Long-term Confidence**: - Sustained growth expected from livestock and diagnostics, with a focus on executing commercial strategies [30][32] - **Future Growth Projections**: - Long-term growth expectations remain robust, supported by industry trends and Zoetis's innovation pipeline [35] Conclusion - **Zoetis's Position**: - Well-positioned to capitalize on the growing animal health market with a strong pipeline, innovative products, and a disciplined approach to capital allocation [26]

44TH ANNUAL J.P. MORGAN HEALTHCARE CONFERENCE Leading the Future of Animal Health January 12, 2026 Forward-Looking Statements This presentation contains forward-looking statements, which reflect the current views of Zoetis with respect to: industry growth and market outlook; business plans or prospects; future operating or financial performance; future guidance; future operating models; R&D costs; timing and likelihood of success; expectations regarding products, product approvals or products under developm ...

Fundsmith Equity Fund Performance - Fundsmith Equity Fund's T Class Accumulation shares returned 0.8% in 2025, underperforming the MSCI World Index which returned 12.8% [1] - Since inception, the fund has outperformed the index by 1.7% per annum [1] - Underperformance in 2025 attributed to index concentration, growth of assets in Index Funds, and dollar weakness [1] Investment Focus and Strategy - Fundsmith Equity Fund highlighted Zoetis Inc. (NYSE:ZTS) as a key investment in its fourth-quarter 2025 letter [2][3] - The fund sold stakes in Brown-Forman and PepsiCo, and began purchasing Zoetis, EssilorLuxottica, Intuit, and Wolters Kluwer [3] - Zoetis is recognized as a leading veterinary pharmaceutical company, benefiting from long-term growth in pet healthcare spending [3] Zoetis Inc. Overview - Zoetis Inc. reported a market capitalization of $56.36 billion [2] - The company generated revenue of $2.4 billion in Q3 2025, reflecting a 1% increase on a reported basis and 4% on an organic operational basis [4] - Zoetis's share price faced challenges due to concerns over side effects from its drug Librela, although it remains prescribed by veterinarians [3] Hedge Fund Interest - Zoetis Inc. was held by 72 hedge fund portfolios at the end of Q3 2025, a slight decrease from 75 in the previous quarter [4] - Despite its potential, the company is not among the 30 most popular stocks among hedge funds [4]

Core Insights - The Fundsmith Equity Fund reported a total return of +0.8% for 2025, underperforming the MSCI World Index which rose by +12.8% [4][7]. - Since inception on November 1, 2010, the Fund has outperformed the Index by 1.7% per annum with a Sortino Ratio of 0.75, indicating less downside volatility compared to the Index [7][8]. - The Fund is ranked as the third best performer in the Investment Association Global sector of 155 funds since inception, with a return 322 percentage points above the sector average [8]. Performance Analysis - The Fund's performance in 2025 was impacted by three main issues: index concentration, the growth of assets in index funds, and dollar weakness [9][10][36]. - The top ten stocks in the S&P 500 accounted for 39% of its value and contributed 50% of its total return in USD by the end of 2025, highlighting significant market concentration [13][10]. - The rise of index funds has led to a momentum strategy that disproportionately benefits large-cap stocks, making it challenging for active funds to compete without holding these stocks [17][20]. Market Dynamics - The US dollar weakened against the pound from approximately $1.25/GBP to $1.35/GBP during 2025, affecting the GBP value of the Fund as most companies are US-listed [36][40]. - The price of gold reached a 50-year high of $4,319 per ounce, reflecting concerns about dollar strength and market conditions [39]. Portfolio Composition - The Fund's portfolio turnover was low at 12.7%, with a total cost of investment (TCI) of 1.06%, indicating a focus on minimizing trading costs [70][72]. - The weighted average free cash flow yield of the portfolio increased from 3.1% to 3.7% during 2025, suggesting improved valuation relative to the S&P 500 [68][69]. Stock Contributions - The top five detractors from the Fund's performance included Novo Nordisk, Automatic Data Processing, Church & Dwight, Coloplast, and Fortinet, with Novo Nordisk facing significant challenges in its market [45][46]. - Conversely, the top contributors were Alphabet, IDEXX, Philip Morris, Meta Platforms, and Microsoft, with Alphabet making its first appearance among the top contributors [51][52]. Investment Strategy - The Fund maintains a strategy focused on investing in high-quality companies with predictable growth and adequate returns on capital, avoiding momentum-driven investments [41][42]. - The Fund's management emphasizes the importance of understanding the underlying business performance and maintaining a long-term perspective on investments [60][79].

Group 1 - The stock selection process showed positive momentum in December, with an average gain of 0.83% for the selected 15 stocks [1] - The SPDR® S&P 500® ETF was mentioned as a benchmark for performance comparison [1] Group 2 - The analyst holds long positions in various companies, including ZTS, MSCI, DPZ, and others, through stock ownership, options, or derivatives [2] - The article reflects the analyst's personal opinions and is not influenced by compensation from any company mentioned [2]

Group 1 - The article highlights the potential for above-average market returns by identifying underperforming stocks that may rebound, particularly in the context of a strong overall market performance [1] - Viking Therapeutics and Zoetis are identified as two healthcare stocks that have underperformed in 2025 but may see significant improvements in 2026 [2] - Viking Therapeutics is a clinical-stage biotech company with promising developments in weight management, specifically its investigational GLP-1 anti-obesity medicine VK2735, which is currently in phase 3 studies [4][5] Group 2 - Viking Therapeutics has faced challenges due to profit-taking by investors and high patient dropout rates in mid-stage trials, but the efficacy of VK2735 remains strong, suggesting potential for recovery [6][7] - The company is developing an oral formulation of VK2735, which could enhance its market position in the growing weight loss drug sector [5][6] - Positive clinical and regulatory progress for Viking Therapeutics could lead to a rebound in its stock price as early as next year, making it a stock worth considering [7]

Zoetis Inc. (NYSE:ZTS) is included among the 14 Best Pharma Dividend Stocks to Buy in 2026. BofA Downgrades Zoetis (ZTS) to Neutral, Cuts Price Target Budimir Jevtic/Shutterstock.com On December 15, BofA downgraded Zoetis Inc. (NYSE:ZTS) to Neutral from Buy and lowered its price target to $135 from $165. In other news, on December 5, Zoetis Inc. (NYSE:ZTS) announced that Health Canada approved Portela™ (relfovetmab injection) for the relief of pain linked to osteoarthritis, or OA, in cats. Portela is d ...

Core Viewpoint - Zoetis Inc. will host a webcast and conference call to discuss its fourth quarter and full year 2025 financial results on February 12, 2026, led by CEO Kristin Peck and CFO Wetteny Joseph [1]. Group 1: Financial Results Announcement - The conference call is scheduled for 8:30 a.m. (ET) on February 12, 2026, where financial analysts will have the opportunity to ask questions [1]. - Investors and the public can access the live webcast through the Zoetis website, with pre-registration available starting today [2]. Group 2: Company Overview - Zoetis is recognized as the world's leading animal health company, focusing on advancing care for animals and supporting those who raise and care for them [3]. - The company has a strong portfolio and pipeline of medicines, vaccines, diagnostics, and technologies, impacting over 100 countries [3]. - In 2024, Zoetis generated revenue of $9.3 billion and employs approximately 13,800 people [3].

Zoetis Inc. (NYSE:ZTS) is included among the 15 Dividend Stocks with Low Payout Ratios and Strong Upside. Zoetis (ZTS) Positioned Within Morgan Stanley’s 2026 Healthcare Playbook Budimir Jevtic/Shutterstock.com On December 18, Morgan Stanley lowered its price target on Zoetis Inc. (NYSE:ZTS) to $160 from $175 and kept an Overweight rating. In its year-ahead outlook, the firm said healthcare technology and providers offer an “attractive backdrop for alpha-generation opportunities” in 2026. Managed care i ...